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A common stock just paid a dividend of $5 per share. The dividend is expected to grow each year at

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A common stock just paid a dividend of $5 per share. The dividend is expected to grow each year at 6% over the next 20 years, at 4 % beyond year 20 until year 40, and at 2% in perpetuity beyond year 40.

What would be the stock intrinsic value today if the discount rate were 12%?

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Answer rating: 100% (QA)

1 Calculate the present value of dividends for the first 20 years with a 6 growth rate First we need View the full answer


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Related Book For  answer-question
Financial Management Theory and Practice

Financial Management Theory and Practice

ISBN: 978-1305632295

15th edition

Authors: Eugene F. Brigham, Michael C. Ehrhardt

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Posted Date: September 21, 2023 01:26:41
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